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TMI Blog2022 (8) TMI 1162X X X X Extracts X X X X X X X X Extracts X X X X ..... d 16th August, 2021 passed by the Adjudicating Authority, (National Company Law Tribunal, Ahmedabad) For short 'NCLT' in Interlocutory Application No.273 of 2021 (filed by the respondent No.1 - H.R. Commercial Private Limited, in IA No.698 of 2020 (filed by Liquidator) in Company Petition (IB) No.53 of 2017. For the sake of convenience, we propose to refer to the facts narrated in Civil Appeal No.7722 of 2021. FACTS OF THE CASE 2. The facts of the case necessary to decide the present appeals are as follows. 2.1 Vide Agreement dated 26th February, 2008, Gujarat Maritime Board For short 'GMB' leased out a parcel of land to ABG Shipyard Limited For short 'Corporate Debtor' for a period of thirty years. On 1st August, 2017, ICICI Bank Limited moved an application for initiation of Corporate Insolvency Resolution Process For short 'CIRP' against the Corporate Debtor under Section 7 of the IBC read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules For short 'IBC Rules', 2016 before the Adjudicating Authority, NCLT, Ahmedabad [CP(IB) No.53/NCLT/AHM/2017] wherein, Mr. Sundaresh Bhat was appointed as an Interim Resolution Professional For short ' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Process at a base price of Rs.460 crores (being lower than the earlier calculated reserve price of Rs.516 crores) as some assets from the Dahej Material were kept reserved for a potential buyer. The second Swiss Challenge Process was initiated on 22nd March, 2021 and at the Anchor Bid stage, the respondent No.2 - Liquidator received bids from R.K. Industries, appellant in Civil Appeal No.7731/2021, respondent No.4 - V.K. Industrial Corporation Limited and respondent No.5 - M/s Ankit International. 2.4. On 23rd March, 2021, the appellant submitted its bid of Rs.431 crores along with Expression of Interest and deposited a sum of Rs.1.00 crore in terms of the bid requirement. Though the last date for submitting the Earnest Money Deposit For short 'EMD' in terms of the Process Document was as 24th March, 2021, the appellant deposited the EMD of Rs.43.10 crores with the respondent No.2 - Liquidator for selection as an Anchor Bidder on 26th March, 2021 along with an affidavit stating inter alia that it agreed to be bound by the terms of the Swiss Challenge Process. 2.5. The second stage of the Swiss Challenge Process commenced on 27th March, 2021 when the respondent No.2 - Liquidator ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consider and accept its offer for buying the consolidated assets of the Corporate Debtor. Around the same time, the respondent No.8 - Kanter Steel India Private Limited also moved an application (IA No.379 of 2021) before the NCLT for quashing of the second Swiss Challenge Process. 5. On 5th July, 2021, the NCLT directed the respondent No.2 - Liquidator to permit the respondent No.7 - Welspun to inspect the assets of the Corporate Debtor. After the said inspection, vide letter dated 2nd August, 2021, the respondent No.7 - Welspun hiked its offer for the consolidated assets from Rs.627.50 crores to Rs.650 crores on an 'as is where is basis'; 'as is what is basis' and 'wherever there is basis'. 6. On 6th August, 2021, a Meeting of the SCC was convened wherein, the respondent No.2- Liquidator appraised the stakeholders of the further developments that had taken place and the offer letter dated 2nd August, 2021 issued by the respondent No.7-Welspun bidding for the consolidated assets of the Corporate Debtor. The SCC advised the respondent No.2-0Liquidator to place the relevant facts and the bid received from the respondent No.7-Welspun before the NCLT. It is the stand of the responden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CLAT has gone on to modify the order dated 16th August, 2021 passed by the NCLT directing the respondent No.2- Liquidator to complete the entire private sale within three weeks in the following manner : "39. It is clear from the ratio of the above mentioned judgments that the specific context in which an auction is carried out can only elucidate the aspect of arbitrariness and favouritism or otherwise. Thus, in the present appeal where the Impugned Order challenging the stoppage of second Swiss Challenge Process and taking up a fresh private sale process has been challenged, it is seen that the decision of the stakeholders and the liquidator, upon which the Adjudicating Authority has based its order does not grant any particular party any favour. It is driven by the stakeholders' wish to get the liquidation process concluded early without losing sight of maximization of value of assets. Also, even though this is a private sale as opposed to sale by a government authority, we are of the opinion that the standards and norms of transparency, fairness and responsibility should be adopted without any qualification or reservation and all prospective bidders should get sufficient no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsel submitted that the NCLAT has erred in upholding the order of NCLT of going in for Private Sale of the composite assets of the Corporate Debtor inasmuch as there were no takers for the same at the announced reserve price in five rounds of e-auction conducted earlier by the respondent No.2-Liquidator. Contending that when there are no allegations or observations made in the impugned order that the Swiss Process challenge was irregular or improper, there was no justification for interfering with the said process that had already been set into motion for a second time in March, 2021 wherein the appellant was declared as the Anchor Bidder thereby giving it a Right of First Refusal For short 'ROFR' in respect of the Dahej Material. Finding fault with the observations made in the impugned order that the views of the stakeholders regarding the sale of assets are significant as they are the ultimate beneficiaries of the liquidation process and a substantial period of time had already been spent in the liquidation process without any fruitful results, it was submitted on behalf of the appellant that the aforesaid observations run contrary to Regulation 31-A of the Liquidation Regulation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , more so when the entire sale process had almost reached a closure when respondent No.7 - Welspun suddenly intervened seeking a composite sale of the assets of the Corporate Debtor. Lastly, learned Senior Counsel for the appellant submitted that the NCLAT has erred in directing that a fresh bid ought to be conducted. Instead, the appellant being the Anchor Bidder, ought to be given the benefit of matching the highest bid submitted without scrapping the Second Swiss Challenge process. 14. Mr. Arvind Datar and Mr. Savla, learned Senior counsel appearing for the respondent No.2 - Liquidator sought to repel the arguments advanced on behalf of the appellant and asserted that the respondent No.2 - Liquidator had conducted the liquidation process of the Corporate Debtor in consultation with the stakeholders at every step and in the best interest of the Corporate Debtor, while strictly adhering to the provisions of the IBC and the Liquidation Regulations. Laying emphasis on the mandate of the Liquidator under the IBC to ensure maximisation of the value of the assets of the Corporate Debtor, it was stated that the intention of the respondent No.2 - Liquidator all through was to sell the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cond stage which involved opening the process to the public to match the bid given by the appellant as the Anchor Bidder, was not concluded. Relying on the decisions in Laxmikant and Others v. Satyawan and Others (1996) 4 SCC 208 and State of Jharkhand and Others v. CWE-Soma Consortium (2016) 14 SCC 172, it was canvassed that since the Second Swiss Challenge Process was not concluded, no vested right had accrued in favour of the appellant for seeking enforcement in the Court of Law. 17. It was next argued that having accepted the terms of Anchor Bid Document, the appellant cannot be permitted to challenge the decision of the respondent No. 2- Liquidator who had to cancel the Second Swiss Challenge Process. In this context, reference was made to the affidavit dated 23rd March, 2020 submitted by the appellant wherein it had undertaken to remain unconditionally and irrevocably bound by the Swiss Challenge Process document as also by the decision of the respondent No.2 - Liquidator to cancel/ abandon/modify at any time solely at his discretion, the sale process or any part thereof. To bring home the said point, reliance has been placed on Clause 11.6 of the Swiss Challenge Process and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pacting the value of the Corporate Debtor and its assets. 19. The only grievance raised on behalf of the respondent No.2 - Liquidator is in respect of the directions issued in the impugned order calling upon him to restart the process of Private Sale dated 24th August, 2021 after giving an open notice to all the prospective buyers. Supporting a similar stand taken by the respondent No.7 - Welspun (appellant in Civil Appeal No. 7731 of 2021) that any such step will delay the liquidation process and result in putting the clock back to the stage of open auction, learned counsel submitted that the process that is under challenge is the Private Sale process which is duly contemplated in Regulation 33(2) of the Liquidation Regulations and cannot be questioned. Additionally, reference was made to a subsequent development where the Core Committee of Financial Creditors conducted a meeting on 15th December, 2021, after the impugned order was passed and had expressed a unanimous view that the Private Sale process should be continued and not restarted having regard to the fact that it has taken almost three years to find a buyer and the same is at the stage of being brought to a closure. A c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the liquidation process results in depletion in the value of the Corporate Debtor and a low realization, learned counsel for Welspun argued that it is imperative to preserve the economic value of the assets of the Corporate Debtor and expedite the realization process by carrying it forward instead of putting the clock back and directing the respondent No.2 - Liquidator to start afresh. In fact, the aforesaid direction was sought to be described as a fusion of two distinct concepts of 'Private Sale' and 'public auction' and it was submitted that issuance of an 'open notice' runs contrary to the very object of going in for a private sale. Learned counsel for Welspun concluded by citing a recent decision in Jaypee Kensington Boulevard Apartments Welfare Association and Others v. NBCC (India) Limited and Others (2022) 1 SCC 401 where emphasis has been laid on the object of the IBC being to ensure resolution/liquidation in a time bound manner for maximization of value assets in order to balance the interest of all the stakeholders. It was urged that as the respondent No.2 - Liquidator has taken a decision to sell the assets of the Corporate Debtor on a composite basis by Private Sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the said application was not on record when the Company Appeal was listed before the NCLAT on 24th November, 2021, on which date, orders were reserved in the Appeal followed by the impugned judgment that was passed on 10th December, 2021. The applicant seeks impleadment in the present Appeal and supports the impugned judgment to the extent that the NCLAT had directed the respondent No.2 - Liquidator to restart the sale process after issuing an open notice to the prospective buyers, thereby affording an opportunity to the applicant to submit a bid for the consolidated assets of the Corporate Debtor on a plea that so far, its offer is the highest. ANALYSIS 23. We have perused the impugned judgment as well as the documents placed on record and carefully considered the rival submissions advanced by learned counsel for the parties. Only two points arise for consideration in these appeals. Firstly, whether the respondent No.2 - Liquidator was justified in discontinuing the Second Swiss Challenge Process for the sale of a part of the assets of the Corporate Debtor wherein the appellant - R.K. Industries was declared as an Anchor Bidder and opting for a Private Sale Process through di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iquidation of companies is handled by the High Courts. Individual bankruptcy and insolvency is dealt with under the Presidency Towns Insolvency Act, 1909, and the Provincial Insolvency Act, 1920 and is dealt with by the Courts. The existing framework for insolvency and bankruptcy is inadequate, ineffective and results in undue delays in resolution, therefore, the proposed legislation. 2. The objective of the Insolvency and Bankruptcy Code, 2015 is to consolidate and amend the laws relating to reorganisation and insolvency resolution of corporate persons, partnership firms and individuals in a time-bound manner for maximisation of value of assets of such persons, to promote entrepreneurship, availability of credit and balance the interests of all the stakeholders including alteration in the priority of payment of government dues and to establish an Insolvency and Bankruptcy Fund, and matters connected therewith or incidental thereto. An effective legal framework for timely resolution of insolvency and bankruptcy would support development of credit markets and encourage entrepreneurship. It would also improve Ease of Doing Business, and facilitate more investments leading to highe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the raison d'étre of the IBC for giving a purposive interpretation of the statute, this Court has observed that : "96. .... IBC was introduced as a watershed moment for Insolvency law in India that consolidated processes under several disparate statutes such as the 2013 Act, SICA, SARFAESI, the Recovery of Debts Act, the Presidency Towns Insolvency Act, 1909 and the Provincial Insolvency Act, 1920, into a single code. A comprehensive and time-bound framework was introduced with smooth transitions between reorganisation and liquidation, with an aim to inter alia maximise the value of assets of all persons and balance the interest of all stakeholders" 29. The underlying object of the IBC of maximization of the value of the assets of the Corporate Debtor has been highlighted in Swiss Ribbons Private Limited (supra) in the following words : "27. As is discernible, the Preamble gives an insight into what is sought to be achieved by the Code. The Code is first and foremost, a Code for reorganisation and insolvency resolution of corporate debtors. Unless such reorganisation is effected in a time-bound manner, the value of the assets of such persons will deplete. Therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vation of time value is the most important, and efficient outcomes under collective action is the next, both of which are important principles driving the design. However, this is not straightforward in implementation, particularly in an environment where different creditors have different rights over the assets of the entity, information is asymmetric, and governance and enforcement has been traditionally weak."
31. In the Fifth Report of the Insolvency Law Committee, May, 2022 published by the Ministry of Corporate Affairs, Government of India The Fifth Report of the Insolvency Law Committee, May, 2022 published by the Ministry of Corporate Affairs, Government of India at X X X X Extracts X X X X X X X X Extracts X X X X ..... st experience that judicial delays is one of the major reasons for the failure of the insolvency process. Thus, much emphasis was laid in the BLRC Report on expediting the liquidation process by curtailing the delay to ensure that the assets of the Corporate Debtor do not get frittered away or depreciated due to the time lag. Once the stage of CIRP is over and the process of liquidation is set into motion, it is critical that least time is lost in liquidating the assets of the Corporate Debtor. The reasons are not far to see. A quick, smooth and seamless process of liquidation goes a long way in stemming deterioration of the value of the assets of the Corporate Debtor in liquidation and increases the chances of maximizing the returns to the stakeholders. 34. Keeping in mind the underlying object of this special enactment, we may directly proceed to examine Chapter III of the IBC that encapsulates the liquidation process right from the stage of initiation of liquidation, till the stage of dissolution of the Corporate Debtor. Section 33 of the IBC states as follows : "33. Initiation of Liquidation - (1) Where the Adjudicating Authority- (a) before the expiry of the insolvency r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Adjudicating Authority, the liquidator shall have the following powers and duties, namely:- xxxx xxxx xxxx (b) to take into his custody or control all the assets, property, effects and actionable claims of the corporate debtor; xxxx xxxx xxxx (f) subject to section 52, to sell the immovable and movable property and actionable claims of the corporate debtor in liquidation by public auction or private contract, with power to transfer such property to any person or body corporate, or to sell the same in parcels in such manner as may be specified; xxxx xxxx xxxx (n) to apply to the Adjudicating Authority for such orders or directions as may be necessary for the liquidation of the corporate debtor and to report the progress of the liquidation process in a manner as may be specified by the Board. xxxx xxxx xxxx (2) The liquidator shall have the power to consult any of the stakeholders entitled to a distribution of proceeds under section 53: Provided that any such consultation shall not be binding on the liquidator: Provided further that the records of any such consultation shall be made available to all other stakeholders not so consulted, in a manner specified b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to (f) unless the security interest therein has been relinquished to the liquidation estate.] 33. Mode of sale. (1) The liquidator shall ordinarily sell the assets of the corporate debtor through an auction in the manner specified in Schedule I. (2) The liquidator may sell the assets of the corporate debtor by means of private sale in the manner specified in Schedule I when- (a) the asset is perishable; (b) the asset is likely to deteriorate in value significantly if not sold immediately; (c) the asset is sold at a price higher than the reserve price of a failed auction; or (d) the prior permission of the Adjudicating Authority has been obtained for such sale: Provided that the liquidator shall not sell the assets, without prior permission of the Adjudicating Authority, by way of private sale to- (a) a related party of the corporate debtor; (b) his related party; or (c) any professional appointed by him. (3) The liquidator shall not proceed with the sale of an asset if he has reason to believe that there is any collusion between the buyers, or the corporate debtor's related parties and buyers, or the creditors and the buyer, and shall submit a re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te Debtor. The Liquidator is permitted to consult the stakeholders who are entitled to distribution of the sale proceeds. However, the proviso to Section 35 (2) of the IBC makes it clear that the opinion of the stakeholders would not be binding on the Liquidator. Regulation 8 of the Liquidation Regulations refers to the consultative process with the stakeholders, as specified in Section 35 (2) of the IBC and states that they shall extend all necessary assistance and cooperation to the Liquidator for completing the liquidation process. Regulation 31A has introduced a Stakeholders' Consultation Committee that may advise the Liquidator regarding sale of the assets of the Corporate Debtor and must be furnished all relevant information to provide such advice. Though the advice offered is not binding on the Liquidator, he must give reason in writing for acting against such advice. 40. When it comes to the mode of sale of the assets of the Corporate Debtor, whether immovable or movable and other actionable claims, Regulation 33 of the Liquidation Regulations comes into play and states that ordinarily, the Liquidator will sell the said assets through auction, as specified in Schedule-I(1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Corporate Debtor through Private Sale. Only after due permission was granted, did the respondent No.2 - Liquidator approach the stakeholders for consultation. In the meeting held on 28th January, 2021, the stakeholders resolved that the prospective bidders, who wished to participate in the Private Sale of the Dahej Material, be encouraged to do so by adopting the Swiss Challenge Process. Pertinently, the first stage of the said process requires selection of an Anchor Bidder; the second stage entails inviting prospective bidders to submit their bids against the reserve price offered by the Anchor Bidder. At the third stage, the Anchor Bidder gets one chance to exercise the ROFR against the H1 bidder by placing a bid higher than the H1 bid. In the event the Anchor Bidder fails to exercise the ROFR, the said right stands extinguished and H1 bidder would then be declared as successful. 42. In the instant case, the first Swiss Challenge Process did not succeed as the highest offerer failed to deposit the EMD. In the second round of the Swiss Challenge Process, as against the base price of Rs.460 crores fixed for the Dahej Material and scrap, the appellant made a bid of Rs.431 cror ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmitment or any representation of the Liquidator / ABGSL. The Process has to be completed as set out under this document to conclude the transaction/sale successfully." xxxx xxxx xxxx ''m. It is clarified that issuance of this Process Document does not create any kind of binding obligation on the part of the Liquidator or ABG to effectuate the sale of the assets of ABG." xxxx xxxx xxxx "s. The Liquidator reserves the right to cancel, abandon or reject a Bidder / Successful Bidder at any time during the process, and the Liquidator also reserves the right to disqualify a Successful Bidder, in case of any irregularities found such as ineligibility under the I & B Code." "t. Liquidator of ABGSL reserves the right to suspend/ abandon/cancel/extend or modify the process terms and/or documents and/or reject or disqualify any Bidder at any stage of process without assigning any reason and without any notice liability of whatsoever nature." 45. Clause 11.6 and Schedule IV of the Second Swiss Challenge Process Document are also relevant and are worded on the same lines: "11.6 Notwithstanding anything to the contrary contained herein, the Liquidator expressly reserv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y and will take all steps and actions required to effectuate this." 47. A bare perusal of the aforesaid clauses of the Anchor Bid Document and the Second Swiss Challenge Process Document, leave no manner of doubt that the prospective bidders were informed that the Liquidator had reserved the right to abandon/cancel/terminate/waive the said process and/or part thereof at any stage; that issuance of the Anchor Bid Document did not create any binding obligations on the Liquidator to proceed with the sale of the assets of the Corporate Debtor; that the Anchor Bid Document did not constitute an offer/commitment or an assurance of the Liquidator. Identical rights were reserved with the Liquidator even in the Second Swiss Challenge Process Document. In fact, as noted above, Schedule IV goes a step further and entitles the Liquidator to include a bidder to participate in the sale process at any stage. He could even decide to sell the composite assets of the Corporate Debtor during the said process. 48. Merely because the appellant herein had submitted a bid under the Anchor Bid Document and was declared as the Anchor Bidder in the Second Swiss Challenge Process, could not vest a right o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rred choice of the respondent No.2-Liquidator as can be seen from the fact that when public auctions were conducted by him on five earlier occasions, bids were invited for the composite assets of the Corporate Debtor. It is a different matter that the earlier eauctions turned out to be unsuccessful, thus compelling the respondent No.2 - Liquidator to explore other options, including the option to sell the assets in smaller lots. 51. In his wisdom, the respondent No.2 - Liquidator found the offer made by the respondent No.7 - Welspun to be of better value for more than one reason. Firstly, unlike the sale proposed under the Second Swiss Challenge Process that was confined to the Dahej Material, respondent No.7 - Welspun expressed its willingness to purchase the Dahej land and the scrap as a composite asset thereby curtailing two rounds of sales, first for the Dahej Material followed by the Shipyard and the other assets. Secondly, the respondent No.2 - Liquidator had valid reasons to believe that a consolidated sale of the assets of the Corporate Debtor will lead to a higher return and a quicker recovery for the stakeholders. Thirdly, composite sale of the assets would lead to maxim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is no sufficient reason to castigate the move or an action of a public authority as either arbitrary or unreasonable or amounting to mala fide or improper exercise or improper abuse of power by the authority concerned. Courts have always leaned in favour of sufficient latitude being left with the authorities to adopt their own techniques of management of projects with concomitant economic expediencies depending upon the exigencies of a situation guided by appropriate financial policy in the best interests of the authority motivated by public interest as well in undertaking such ventures........" [ 53. On the aspect of rejecting even the highest bid received by an Authority, this Court has held in Laxmikant and Others (supra) as under : "4. Apart from that the High Court overlooked the conditions of auction which had been notified and on basis of which the aforesaid public auction was held. Condition No. 3 clearly said that after the auction of the plot was over, the highest bidder had to remit 1/10 of the amount of the highest bid and the balance of the premium amount was to be remitted to the trust office within thirty days "from the date of the letter informing confirmatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le to the Government. In the case in hand, the respondent has neither pleaded nor established mala fide exercise of power by the appellant. While so, the decision of the Tender Committee ought not to have been interfered with by the High Court. In our considered view, the High Court erred in sitting in appeal over the decision of the appellant to cancel the tender and float a fresh tender. Equally, the High Court was not right in going into the financial implication of a fresh tender." (emphasis added) 55. On the scope of judicial review in examining the decision of the tenderer to cancel the process if the tender document so permits, we may usefully refer to Montecarlo Limited (supra), wherein it is has been held as under : "26. ....... Exercise of power of judicial review would be called for if the approach is arbitrary or mala fide or procedure adopted is meant to favour one. The decision-making process should clearly show that the said maladies are kept at bay. But where a decision is taken that is manifestly in consonance with the language of the tender document or subserves the purpose for which the tender is floated, the court should follow the principle of restraint. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dopted by the respondent No.2 - Liquidator. 57. When compared to the above protracted process described in para 53 above, a single buyer for the Dahej land along with the metal scrap, etc., lying at the complex was bound to speed up the entire process inasmuch as the successful bidder could be handed over the possession straightaway and the respondent No.2 - Liquidator would be in a position to receive the payment for the composite assets in a timebound manner with a higher rate of recovery. All these factors that fall in the realm of commercial considerations were examined holistically by the respondent No.2 - Liquidator who then placed the cards before the stakeholders in the meeting conducted on 6th August, 2021. Even though the provisions of the IBC empower the Liquidator to take an independent decision for the sale of the assets of the Corporate Debtor in liquidation, it can be seen that he has taken the stakeholders into confidence at every step. Only after finding them to be in agreement with the option sought to be explored by him of halting the Second Swiss Challenge Process and proceeding with the Private Sale of the consolidated assets of the Corporate Debtor by directl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d as a rushed decision for the NCLAT to have modified the said order and direct that the clock be set back to the initial stage of issuing notices to the prospective buyers. No such relief was sought by any of the parties to the lis, nor has the NCLAT given any plausible reason for issuing such a direction. 60. The powers vested in and the duties cast upon the Liquidator have been made subject to the directions of the Adjudication Authority (NCLT) under Section 35 of the IBC. Once the Liquidator applies to the Adjudicating Authority (NCLT) for appropriate orders/directions, including the decision to sell the movable and immovable assets of the Corporate Debtor in liquidation by adopting a particular mode of sale and the Adjudicating Authority (NCLT) grants approval to such a decision, there is no provision in the IBC that empowers the Appellate Authority (NCLAT) to suo motu conduct a judicial review of the said decision. The jurisdiction bestowed upon the Adjudicating Authority [NCLT] and the Appellate Authority [NCLAT] are circumscribed by the provisions of the IBC and borrowing a leaf from Committee of Creditors of Essar Steel India Limited v. Satish Kumar Gupta and Others (2020 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hey have weighed in to support the stand taken by the respondent No.2 - Liquidator to continue the bid process commenced on 24th August, 2021, we do not see any reason to foist the view of the NCLAT on the respondent No.2 - Liquidator that he ought to restart the process for sale of the composite assets of the Corporate Debtor from the scratch after issuing an open notice to the prospective buyers. CONCLUSION : 66. Therefore, the impugned judgment dated 10th December, 2021, passed by NCLAT to the extent that it has modified the order dated 16th August, 2021 passed by the NCLT and directed restraining of the Private Sale Process, is quashed and set aside. In our opinion, the Private Sale process of the composite assets of the Corporate Debtor should be taken further by the respondent No.2 - Liquidator without losing any further time and be concluded at the earliest. All the eligible bidders who have made Earnest Money Deposits would be entitled to participate in the negotiations to be conducted by the respondent No.2-Liquidator for privately selling the consolidated assets of the Corporate Debtor. Accordingly, we direct that the process of private negotiations that had commenced ..... X X X X Extracts X X X X X X X X Extracts X X X X
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